ODE Asset Management races to reassure clients after founders indicted

O’Day Asset Management has told clients it is in “active discussions” with all of its service providers as the hedge fund battles to restore confidence in the group after a Financial Times investigation alleged that its founder Crispin O’Day Had sexually harassed or harassed 13 women.

The FT reported on Thursday that Morgan Stanley is going to distance itself from the London-based hedge fund. JP Morgan and Goldman Sachs are also reviewing their prime broking ties with the group. Prime brokers are important to hedge funds, providing them with credit to facilitate their trading.

Oday Asset Management chief executive Peter Martin said in a statement to clients on Thursday that he was “confident that our service providers will continue to work with us to ensure that investors’ interests are protected”.

The effort to reassure customers comes as the firm faces a wider investigation by the UK’s Financial Conduct Authority, which launched an investigation into possible “non-financial misconduct” at the company two years ago.

O’Day later shifted the investigation to focus on corporate governance issues after he fired his executive committee in late 2021 after he received a “final written warning” to stop behaving inappropriately with female employees. Tried to discipline him for breaking.

The FCA inquiry could now widen to investigate new allegations against O’Day, reported in the FT, which revealed 13 women alleged they were sexually harassed or assaulted by him over the past 25 years. Two incidents occurred in 2021, when O’Day was acquitted of a sexual assault charge brought against him by a female banker in relation to an encounter in 1998. A law firm representing O’Day said the allegations were “strongly disputed”.

In a statement to clients, Martin said the “various allegations” were being “looked into” by the firm’s lawyers and that it “takes very seriously all such allegations now and in the past”.

Crispin O’Day told Reuters on Thursday that Morgan Stanley’s move was a “broadly quick response to an allegation by the FT”, adding that “none of the allegations have stood up in court or the investigation”.

The FCA said it could not comment on individuals or specific firms, adding: “However, we take allegations of non-financial misconduct seriously and expect firms to have adequate governance processes in place to deal with allegations of misconduct.” ensure proper investigation.”